Trade the Farm

A Caffeinated Rally

Feb 20, 2014

Over the last few days coffee and natural gas have rallied about 12%. For a little perspective, if this were to happen in corn or beans we would be limit up for a couple of days at least.

This rally is occurring because of political unrest in the Ukraine and Venezuela, and also because of adverse weather in South America. The price of coffee has been very volatile this year, and has gone up 40% thanks to a severe South American drought.Luckily for us, grains seem to have caught this wave.

With no change in fundamentals, all the smart people here at Trade the Farm predict a gradual ebb back to prior levels.But for now we, and all of our great farmers are very grateful to be up here. These levels offer a great pricing opportunity.As you have heard me say time and time again, our farmers aren’t paid to grow their grain, they’re paid to sell the grain they’ve grown.

There is a significant risk of loss in trading futures and options.Futures trading is not appropriate for all investors.Please read our full risk disclosure at www.tradethefarm.com